Relay access denied

We have an Exchange 2003 server, sending email via Outlook 2003, and 2007. when we send out emails only one contact we get this error. There are no other issues with sending out any other kinds of emails to any one else.

Your message did not reach some or all of the intended recipients.

Subject: News
Sent: 1/7/2009 10:22 AM

The following recipient(s) cannot be reached:

Billy, Bob on 1/7/2009 10:23 AM
You do not have permission to send to this recipient. For assistance, contact your system administrator.
: Relay access denied>

In the above error I changes recipient info for their protection.